Marshall Auerback - Goldman Sachs Takeaway: Fix Our Financial System or Get Ready for the Next Horrific Collapse
March 28, 2012 Greg Smith's mea culpa about Goldman should not come as a surprise to anybody who has a remote connection with the financial services industry. But to suggest that the allegations made by Mr. Smith are unique to Goldman's culture is ludicrous. They are symptomatic of a much broader problem embedded in Wall Street culture as a whole. Goldman's major sin was being more astute at exploiting this system than most of its competitors.
The toxic derivatives sold to what employees of Goldman derisively referred to as "muppet" clients (since when was being a "muppet" such a bad thing?) were certainly neither a trend unique to GS, nor was it a recent phenomenon. The truth is that this activity has been embedded in Goldman's culture since the days when Robert Rubin was co-CEO of the company and advocated GS taking proprietary positions (trading for its own account), even if it meant betting against their clients.
Goldman was a successful company and success tends to breed imitation. Eventually, everybody on Wall Street was doing the same shitty business. Goldman, for example, wazsn't the only one selling these toxic mortgage products, which helped to blow up the world's global economy in 2008, but they were smart enough to hedge them.
Read More:
